SoftBank Group drew more than $20 billion of preliminary, non-binding investor demand for its junk bond offering, people familiar with the matter said, nearly double the equivalent of $11 billion the company is seeking to raise to help fund its next investment in OpenAI, as reported by the Japan Times on 23 September.
Key points
- Preliminary demand exceeds $20 billion for a planned $11 billion equivalent offering across dollar and euro tranches
- Proceeds earmarked for SoftBank’s $10 billion third-tranche investment in OpenAI, expected to close 1 October
- Deal would be the largest Asia-Pacific and Japan non-financial corporate bond on record if completed at planned size
- Longest dollar tranche discussed at yield up to about 10% for 7.5-year notes, a record at that tenor
- SoftBank has sold almost $15 billion of notes in 2026, making it the biggest junk-rated borrower in global bond markets this year
Record demand and deal structure
The company is seeking to raise the equivalent of more than $11 billion through a $10 billion dollar tranche and a €1 billion euro tranche, with no cap on the final size, the Japan Times reported. The dollar notes come in 3.5, 5.5 and 7.5 year tenors, while the euro portion carries four and six year tenors, Channel Insider reported citing a term sheet. Pricing is expected on 24 September with settlement on 29 September, Channel Insider added.
SoftBank and its lead banks had been sounding out investors on potential pricing, with the longest dollar tranche discussed at a yield up to about 10% and the longest euro tranche in the mid-8% area, the Japan Times reported. If set at those levels, the yields would be records for those currencies at those tenors, though details may shift before initial price guidance, the Japan Times reported.
Citigroup is acting as lead bookrunner and joint global coordinator for the dollar notes alongside Goldman Sachs, JPMorgan Chase and Morgan Stanley, while JPMorgan is lead bookrunner for the euro-denominated notes with Goldman Sachs and Deutsche Bank as joint global coordinators, the Taipei Times reported.
OpenAI investment and financing chain
Proceeds are designated for SoftBank’s $10 billion third-tranche investment in OpenAI, expected to close 1 October, and for general corporate purposes, Channel Insider and Quartz reported. The offering will also retire unused portions of a 2026 bridge loan, Channel Insider reported. SoftBank has committed close to $65 billion to OpenAI, with cumulative investment expected to reach about $64.6 billion after the third tranche, representing an ownership stake of roughly 13%, Quartz reported citing the company’s first-quarter earnings disclosure.
The conglomerate entered a $40 billion bridge loan in March to fund an additional OpenAI investment and recently repaid the outstanding balance of $25.9 billion on that facility. The group has also increased a margin loan secured by Arm Holdings shares to $25 billion and secured an $11.87 billion loan for the OpenAI investment. Apollo Global Management is in talks to boost a loan to SoftBank by $3.6 billion to $9 billion for the same purpose, the Japan Times reported.
OpenAI chief executive Sam Altman has said the company will not go public this year, which would make SoftBank’s stake more liquid, the Japan Times and Taipei Times reported. That timing issue leaves investors watching for other ways SoftBank can eventually unlock value from its holding, Channel Insider noted.
Credit profile and market context
SoftBank is rated BB+ by S&P Global Ratings and Fitch Ratings, their highest speculative-grade rating, the Japan Times and Taipei Times reported. By contrast, Alphabet and Amazon, the two biggest sellers of corporate bonds in 2026, carry ratings of AA+ and AA respectively, higher than the Japanese sovereign, the same publications added. Fitch assigned the proposed notes a BB+ rating and said the conglomerate’s leverage will probably rise as it fulfils its investment pledges, while expecting the company to keep ample cash and ongoing market access, Quartz reported.
This year SoftBank has issued nearly $15 billion of notes across currencies, making it the largest junk-rated borrower in global bond markets in 2026, the Japan Times reported citing Bloomberg data. The share price has fallen about 34% from its June peak as investors assess how the company will fund its plans and consider the possibility of an OpenAI listing pushing into 2027, Quartz reported.
The yield on SoftBank’s dollar bond due 2031 reached 8.2% this month, up from 6.7% in January, as the gap over Treasuries widened and benchmark yields rose, the Japan Times reported citing Bloomberg data. The cost to insure SoftBank’s debt against default recently hit a three-year high, the Japan Times added. If completed at its planned size, the offering would surpass 7-Eleven’s $10.93 billion sale in January 2021 as the largest Asia-Pacific and Japan non-financial corporate bond deal on record, Channel Insider and Quartz reported citing LSEG data.
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